Nowhere is CBC/Radio-Canada's value to Canadians more visible than in news and current affairs. Living in a globalized world, we must recognize the significant contribution of the CBC/Radio-Canada to Canada's cultural independence.
President and CEO
Clearly, a renewed commitment to CBC/Radio-Canada would represent a substantial investment in our nation's future. I would also like to thank every CBC/Radio-Canada employee for their daily contributions.
H IG H LIG HTS OF 2003-2004
Canadians trust CBC/Radio-Canada to deliver the news with the highest standards of journalistic integrity and excellence. With news teams across Canada and around the world, CBC/Radio-Canada delivers the information and analysis Canadians need to make informed decisions.
News and Current Affairs
L'engagement de CBC/Radio-Canada à soutenir et à diffuser des documentaires canadiens était encore une fois évident sur CBC Newsworld, RDI, la Télévision de Radio-Canada et CBC Television. René Homier-Roy, présentateur, C'est beaucoup mieux le matin, Première Chaîne, Radio de Radio-Canada.
Arts and Entertainment
CBC/Radio-Canada's arts and entertainment programming features the best in Canadian artistic production from the country's leading creators and artists. Galaxie is CBC/Radio-Canada's 24-hour digital pay audio service, available through satellite, cable and microwave digital distribution systems.
Children and Young Adults
Sports
CBC/Radio-Canada brings Canadians the world of sport, highlighting the country's best amateur athletes both nationally and internationally. CBC Television and Télévision de Radio-Canada have worked closely together to develop plans to provide Canadians with the very best coverage of the Athens Summer Olympics. As host of the championships, CBC/Radio-Canada broadcast images of the event and Hamilton across Canada and to countries around the world.
13 Henri Chassé, Marie-Thérèse Fortin, Catherine Brunet, Le Monde de Charlotte, Télévision de Radio-Canada.
CBC/Radio-Canada on the International Scene
CBC/Radio-Canada's international radio service, broadcasting in nine languages via satellite, digital and analog shortwave, Internet and local radio stations in over 75 countries. In March 2003, the Government of Canada redefined Radio Canada International's mandate – to produce and broadcast programs specifically designed to better acquaint foreign audiences with Canada, its values and its social, economic and cultural life. To fulfill its new mandate, in September 2003, the RCI presented its five objectives to the Department of Canadian Heritage and the Department of Foreign Affairs and International Trade: to clearly target its international audience; to promote Canadian talent abroad; to provide more insight on important Canadian and international issues to foreign audiences; to increase partnership activities; and to leverage the power of the CBC/Radio-Canada group.
Radio de Radio-Canada and CBC radio staff reflect Canada's cultural mosaic, and their world music programs and documentaries cover a wider range of topics.
Reflecting the Diversity of Canada
As Canada becomes more diverse, we are changing to ensure our programming remains relevant to the people we serve. Our unwavering commitment to the reflection of contemporary Canada is reflected in one of our strategic priorities: developing high-quality, distinctive Canadian programming that recognizes the importance of regional reflection and of the changing face of Canada. At the same time, our networks reflect diversity in different ways depending on the characteristics of their platforms.
Launched in 1997, CBC Radio's New Voices strategy brings the full range of people and perspectives in our communities on air and behind the scenes.
Behind the Scenes
One of CBC/Radio-Canada's priorities is to strengthen its commitment to all its employees – to those who create and those who support them technically and administratively. It also includes improving the value we add to the Corporation through HR expert services at the same time as we simplify, automate and make more efficient the transactional HR services provided. We received significant recognition this year when we were selected for the 2004 edition of Canada's Top 100 Employers.
We expect to continue to build on this positive corporate recognition as we move forward with our strategy.
Building and Strengthening Our Team
CBC/Radio-Canada strives to deliver excellent, distinctively Canadian programming through the most efficient technology available and in a fiscally responsible manner. In we undertook a number of initiatives and changes to support our strategic priority – Demonstrate that CBC/Radio-Canada is a well-run company and generate cash flow to reinvest in programming. In fact, we show that the link between these two is synonymous with the revived CBC/Radio-Canada.
Technology CBC/Radio-Canada works diligently to acquire and maintain the best technology to support our broadcasting activities.
Better Programming through New Technology
This year, CBC/Radio-Canada Transmission increased by more than $1 million the revenue generated by leasing space on our towers, sites and buildings to private broadcasters, mobile phone companies and government services, selling shortwave transmission services and providing technical maintenance services to other broadcasters. Our Vision Project is a major undertaking of CBC/Radio-Canada Technology and our English and French television networks to provide a single, integrated way to manage contracts and content, program inventory and schedules, broadcast and media management, marketing and sales, promotions, management, and airtime analysis. CBC/Radio-Canada is the first major North American broadcaster to implement the new version of iNEWS, which creates our internal news wire for the efficient sharing of research and stories that cover all of our media.
CBC/Radio-Canada has been an important member of the Canadian community for nearly 70 years, covering local and regional stories, sponsoring and partnering with cultural groups, and participating in charitable events.
CBC/Radio-Canada in the Community
Most importantly, our community outreach efforts support the Corporation's strategic priorities related to providing distinctive high-quality programming, regional reflection, entering into selective alliances and partnerships, and enhancing and strengthening our stakeholder relationships. Initiating or involving ourselves in concerts, festivals and literary award galas enables us to showcase established and new talent. Our outreach activities allow us to improve our relationships and create a greater dialogue with communities.
These types of community activities provide the opportunity for valuable exchange and dialogue and are also part of the company's public accountability strategy.
Public Accountability
Over the past few years, the chairman of the board has worked to renew the board's relations with the top management of the company, the government and external stakeholders in general. The chairman has been instrumental in ensuring that corporate management practices for the company are at the forefront in both the private and public sectors. The following points are in place in the company and have been reviewed, revised and compared with best practice in other companies.
FINANCIAL PAGES
Creation of a common services organization for the implementation of modernized administrative practices and the development of synergies between departments.
2003-2004 HIGHLIGHTS
In December 2003, the Corporation amended the terms of two operating lease agreements for the rental of parcels owned by the Canadian Broadcasting Centre. The terms of the new agreements require that these leases be accounted for as sales-type leases. The amount will be used to finance payments of $33 million related to the capital lease agreement for the Canadian Broadcasting Centre.
The Company's contribution holiday in respect of its pension fund ended on 31 December 2003; from January 1, 2004, the company will therefore again contribute to the pension fund, which will represent an additional expense of $43 million per year.
ANALYSIS OF FINANCIAL RESULTS
This amount will be received over 24.4 years, and the annual interest rate is 7.15%. With the sale of the land on which the Canadian Broadcasting Center (Toronto) is located, and with changes to the terms of two business leases of land, which are now accounted for as sales leases, the profit was USD 125. million. Accounting for real estate leases as sales leases results from changes to the terms of two business leases for the lease of land parcels in Toronto.
Under these rules, actuarial accounting must be used to determine assets and liabilities in relation to the Pension Fund and to other employee future benefits.
FISCAL 2004-2005 AND SUBSEQUENT YEARS
FINANCIAL RESULTS HIGHLIGHTS FROM THE PAST FIVE YEARS
AUTHORITY AND OBJECTIVE
CBC/Radio-Canada was first established by the Canadian Broadcasting Act of 1936 and continued by the Broadcasting Act of 1991. As the national public broadcaster, CBC/Radio-Canada provides radio and television services in both official languages, which include predominantly and distinctly Canadian programming that reflects Canada and its regions to national and regional audiences.
SIGNIFICANT ACCOUNTING POLICIES
Tangible fixed assets acquired on the basis of capital leases are initially recorded at the present value of the minimum rents at the conclusion of the lease. Initial costs incurred as a result of a business lease are amortized over the lease term. The transition asset/liability, net actuarial gains and losses and adjustments arising from plan changes are amortized over the estimated average remaining lives of the employee group.
In the case of severance payments, the transitional liability and net actuarial gains or losses are amortized over the average remaining service life of the group of employees.
PARLIAMENTARY APPROPRIATIONS
The preparation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and costs for the year. The Canadian Institute of Chartered Accountants has issued Accounting Guideline 13, Hedging Relationships, which becomes effective for the Corporation on April 1, 2004. Accordingly, the Corporation's net results of operations for the year on a government financing basis differ from those on a Canadian government financing basis. accepted basis for accounting principles.
These funds are used in all media for the improvement of program initiatives in particular.
RADIO CANADA INTERNATIONAL a. Funding for Radio Canada International
SPECIALTY SERVICES a. Country Canada
The Corporation operates CBC Newsworld, the Réseau de l'information (RDI), Galaxie and Country Canada under license terms that require the reporting of incremental costs and revenues. As provided in their licensing agreement, CBC Newsworld and RDI use accumulated excess revenues over prior years' expenses to fund the current year's operations. 1 Capital expenditures for the purchase of equipment for the introduction, maintenance and expansion of the Specialty Services will be made by CBC/Radio-Canada from the capital appropriation with an approved repayment plan for the company to recover from Specialty Services revenues .
INCOME TAX AND TAX ON LARGE CORPORATIONS
Recovery of income and taxes on large corporations differs from the amount that would be calculated by applying the Federal statutory income tax rate of 34.02 percent percent) to net results before taxes.
SHORT-TERM INVESTMENTS
PROPERTY AND EQUIPMENT
NET INVESTMENT IN SALES-TYPE LEASES a. Amendment to Land Leases
NOTES RECEIVABLE
1 CBC/Radio-Canada has not recorded some of The Documentary Channel's losses as the company does not assume any financial risk related to The Documentary Channel. On September 27, 2003, CBC/Radio-Canada ended its partnership with Publications Gesca ltée, with the Corporation holding a 50 percent interest in Les Éditions Voilà.
DEFERRED CAPITAL FUNDING
PENSION PLANS ASSET AND EMPLOYEE-RELATED LIABILITIES Employee-related liabilities are as follows
Per March 31, 2004, the accrued benefit obligation for the CBC/Radio-Canada Pension Plan and for.
OBLIGATION UNDER CAPITAL LEASE
COMMITMENTS a. Program-related and Other
CONTINGENCIES
RELATED PARTY TRANSACTIONS
NET CHANGE IN NON-CASH WORKING CAPITAL BALANCES
FINANCIAL INSTRUMENTS
COMPARATIVE FIGURES
